05.07.2018

Take it or leave it

Eddie Ford says Theresa May is manoeuvring to achieve a ‘third way’ Brexit. Chances are that we will see more dither

There can be no doubt that David Cameron has a lot to answer for - just ask big business or those Tory MPs who regard him as the worst prime minister in modern history. Why did he call that referendum?

As a result, Theresa May is a prisoner of circumstances. Dither, delay and obfuscation might have been perfectly legitimate responses when confronted with the near impossible task of dealing with a totally divided cabinet - and the country at large. In his own way, Jeremy Corbyn too is faced with an almost unsolvable Brexit dilemma: go one way and you alienate a certain constituency; go the other way and you upset a different one.

Now, just over two years since the Brexit referendum, the clock is ticking loudly and something has to give soon - though at the moment meeting the October deadline for the wrapping up of negotiations with the European Union seems increasingly unlikely. Hence on July 6 May will be meeting with the entire cabinet at Chequers to thrash out a final post-Brexit customs plan, with the intention of publishing a white paper shortly afterwards setting out the details of the UK’s future relations with the EU.

“Of course,” acidly noted a Financial Times editorial, “this should have been done before triggering article 50, or even before the UK prime minister drew her red negotiating lines” (July 2). But better late than never, presumably, and the prime minister “must face down the hardliners”, comments the paper, by delivering some “hard” and “unpalatable” truths about Brexit - mainly that a no-deal option is “off the table”, as the government “could not survive the ensuing economic and administrative chaos”. What is required is a “sensible deal” based on customs union membership. Crunch time for the Tories.

Perhaps the FT will get what it wants, as Theresa May surprised everyone at the beginning of the week by announcing that she had a “new” customs plan - the “mad riddle” of Brexit continues. Indeed, it has been widely reported that the first time David Davis, the Brexit secretary, heard about it was when he switched on his radio in the morning - at the time of writing a succession of Tory ministers are protesting that they still have not received a copy. The new plan appears to be a hybrid, or Frankenstein’s monster, of the two schemes previously rejected as unworkable - May’s preferred option of a “new customs partnership” (NCP) which would see Britain stay within the customs system and collect tariffs on behalf of Brussels; and the alternative “maximum facilitation” scheme (max fac) involving supposedly wonderful new technology and ‘trusted trader’ schemes. The latter was viewed by Number 10 as hugely costly and unlikely to remove the need for a hard border in Ireland, whilst NCP was detested by the ultras as the “softest Brexit possible” - with Jacob Rees-Mogg, head of the weirdly influential European Research Group, describing it as “idiotic”.

According to one Downing Street insider, May’s new scheme “will be the spawn of the NCP and max fac” - Britain entering into a single market on goods with the EU, collecting tariffs for the EU as per the old plan and potentially opening the door for the European Court of Justice to have some sort of role in arbitrating future trade disputes. It is expected that at the meeting the prime minister will demand that Eurosceptic ministers soften their red lines, including on the ECJ, if they are to persuade Brussels to budge on its tough negotiating position. And it is also thought that May will challenge ministers, such as the increasingly rebellious Boris Johnson, to accept the need for a close alignment on goods regulation to minimise trade friction between Britain and the rest of the EU. Backers of the new idea include business secretary Greg Clark and chancellor Philip Hammond - the latter will be “fully costing” all the various Brexit options, especially the impact of a ‘no deal’. Do not hold your breath waiting to hear about the “Brexit dividend” that will enable extra billions to be pumped into the NHS every year.

Naturally, Rees-Mogg and the ultras are sensing betrayal all over again. He has warned darkly that Theresa May risks “splitting the Conservative Party” if she softens her red lines. May’s new turn - or revival of the old one with a few bells and whistles - has sparked off more excited speculation about mass resignations, leadership bids, votes of no confidence, and so on. Writing in The Daily Telegraph, former Tory leader William Hague advises the “ardent” Brexiteers not to “push too hard” against Theresa May - otherwise “they will end up without their main objective” (July 3). For Hague, the choice is “either to back a compromise plan now or to end up with a more watered-down version of Brexit that would be forced on ministers anyhow” because of the parliamentary arithmetic. A new Tory leader would be confronted with exactly the same problem as Theresa May - no parliamentary majority, looming deadlines and an EU that could be prepared to play serious hardball. Nobody is going to get everything they want.

Ownership

In other words, we have the ongoing saga of splits and divisions within the Tory cabinet - a steaming cauldron of strategic differences mixed up with ever shifting tactical positioning, naked careerism and fine electoral calculations. Anyone who says they know what is going to happen next is either a charlatan or a fool - there are just too many unpredictable factors involved. May seems to be manoeuvring crab-like towards presenting the hard Brexiteers with a ‘take it or leave it’ option - either accept the new compromise plan or there will be a general election. Me or Jeremy Corbyn? Maybe the Brexiteers will buckle, maybe not.

In this whole process, we have had recently a series of seemingly off-the-cuff comments that might sound rather silly, but in their own way act as a profound commentary on contemporary British politics. So in the context of BMW, Airbus, Siemens, etc expressing deep unease about the direction of Brexit - even threatening to relocate their operations elsewhere - we had Boris Johnson saying “fuck business”: a quite extraordinary sentiment to hear from a senior Tory figure. But he does not seem alone in his ‘anti-business’ views. We also had Iain Duncan-Smith, the ‘quiet man’ who inexplicably used to be Tory leader, pointing out that the forerunner of the Confederation of British Industry - the Federation of British Industries - collaborated with the Nazis before the outbreak of World War II, overseeing the creation of 33 separate agreements between British and German business groups. Perhaps even worse, writes Duncan-Smith in the Daily Mail, the CBI “supported the socialistic nationalisation of much of the economy by the Labour government” (June 28). Furthermore, we have had the revelation from the FT and elsewhere that David Davis has thus far spent a grand total of just four hours in talks with the EU’s chief Brexit negotiator, Michel Barnier - which tells you a lot.

This raises up again, as touched upon before in this paper, the important question of the relationship between capital and the Tory Party, which has clearly changed. In part, this is to do with legislation introduced in 2000 requiring shareholders to approve political donations, but the changing nature of the ownership of British industry has helped alter that relationship considerably. Airbus is a trans-European consortium registered in the Netherlands and trading shares in France, Germany and Spain - manufacturing in multiple countries both inside and outside of the EU. BMW and Siemens are obviously German. Go down the list of top CBI companies and you will find a not dissimilar picture. These companies obviously want a ‘business-friendly’ government, which traditionally in the UK has been a role performed by the Tories, but they also need a continuing close relationship with the EU - if not they will transfer production elsewhere.